Morgan Stanley Vice Chairman to Leave

Morgan Stanley‘s vice chairman, Gary G. Lynch, is stepping down and leaving the firm, according to a memo obtained by DealBook on Friday.

“We have greatly benefited from his stand-out leadership in vastly improving our relationships with global regulators, navigating our conversion to a financial holding company, and directing the firm’s efforts resulting in successful resolutions of a number of major litigations and investigations,” Morgan Stanley’s chief executive, James P. Gorman, said in the memo.

Related Links

Mr. Lynch, who has been the firm’s vice chairman since May 2009, joined Morgan Stanley in late 2005 as an executive vice president and chief legal officer when John Mack became chief executive.

For Mr. Lynch, the crucial move was his departure from the post of chief legal officer in February 2010. At that time, Morgan Stanley said Mr. Lynch was stepping down to focus on his duties as vice chairman, according to an internal memo obtained by DealBook. “Gary has decided to step away from his role as chief legal officer and concentrate on his other senior management responsibilities,” Mr. Gorman said in that 2010 memo.

But some analysts saw Mr. Lynch’s move a year ago as signaling the eventual end of his tenure at the firm.

Mr. Lynch has a long history with Mr. Mack, who stepped down as Morgan Stanley’s chief executive at the end of 2010 but continues to serve as its chairman. Prior to Morgan Stanley, Mr. Mack served as the chief executive of Credit Suisse, where he hired Mr. Lynch to be the chief legal counsel for that firm in 2001.

During his tenure, Mr. Lynch was praised for shoring up Credit Suisse’s legal reputation and settling issues with regulators. In the aftermath of the dot-com bust, he helped Credit Suisse navigate claims that it overcharged its clients in public offerings, leading to a $100 million settlement with regulators in 2002.

Mr. Lynch is not the first high-profile executive hired by Mr. Mack to leave the firm. Jack DiMaio, another Credit Suisse alumnus, joined in 2009 to be the global head of interest rate, credit and currency trading and stepped down in January. At that time, the company also announced the resignation of Charles Johnston, president of the Morgan Stanley Smith Barney joint venture; Gregory J. Fleming, who was hired by Mr. Gorman, took over Mr. Johnston’s responsibilities.

Gary G. Lynch has decided to leave and pursue opportunities outside the Firm. Since May 2009, Gary has served as a Vice Chairman of Morgan Stanley based in London. He has been on a number of our Morgan Stanley subsidiary boards throughout the region and has been working as a senior manager advising the Firm on issues of policy and strategy.

As you know, from 2005 to 2010, Gary was our Chief Legal Officer. While Gary’s accomplishments during his tenure are too numerous to list here, we have greatly benefitted from his stand-out leadership in vastly improving our relationships with global regulators, navigating our conversion to a financial holding company, and directing the Firm’s efforts resulting in successful resolutions of a number of major litigations and investigations. We will miss Gary’s wise counsel and outstanding business judgment.

Please join me in thanking Gary for his many contributions and wishing him well in his future endeavors.